Summary
In a case where, on arrival at the original contractual destination, the cargo
interests refused to accept delivery of the cargo on the grounds that it was
damaged, and subsequently arranged with the shipowners for it to be carried to
and delivered at another port, the time limit under Article III Rule 6 of the
Hague-Visby Rules began to run from the time at which the cargo "should
have been delivered" at the original port of discharge and not from the
time that discharge was completed at the new port of discharge. The Claimants’
suit was therefore time-barred and summary judgment was entered in favour of the
defendant shipowners.

DMC Category Rating: Confirmed

Facts
Trafigura chartered Golden Stavraetos' vessel, on a voyage charterparty,
to which the Hague-Visby Rules (‘HVR’) applied, to ship
fuel oil from Saudi Arabia to Lagos. The vessel arrived off Lagos on the evening
of 2 February 2000, when notice of readiness was tendered. The intended
purchaser
refused delivery, alleging that the oil was off specification. Trafigura then
ordered the
vessel to proceed to Abidjan, where it arrived on 13 February 2000. After
further
negotiation, a further voyage from Abidjan to Greece was agreed. This was
covered by an addendum to the original charterparty, which provided for the
freight rate for this voyage and a new period of laytime. The cargo was
eventually discharged in Greece, without further incident.

Trafigura alleged that the shipowners were in breach of contract
in tendering
a notice of readiness at Lagos when the cargo had been contaminated by residues
within the vessel's tanks of soya bean oil. They commenced proceedings in London
against the owners on March 21 2001.The issue was the application of Article III
Rule 6 of the HVR, which provided for the shipowners’ liability to be
discharged unless "suit was brought within one year of the delivery [of the
goods] or of the date when they should have been delivered". The question
was whether time started to run from the date of delivery in Greece, which was
within the one-year limit, or from the date when the cargo "should have
been delivered" at Lagos, namely, at the latest by 6 February 2000.

The charterers’ argument was that the cargo had been delivered
in Greece and that the proceedings were commenced within one year from that
date. Accordingly, the second part
of Article III Rule 6 of the HVR (the "should have been delivered"
part) did not come into play.

Judgment
The judge held that, contrary to certain comments in the first
edition of the text book, Carver on Bills of Lading, the HVR did not confer a
choice on either Trafigura or the shipowners as to which "limb" of
Article III Rule 6 applied. Any "choice" was to be made by the
application of legal principles to the facts of the particular case. The court
must adopt a process of construction appropriate to the interpretation of a set
of Rules agreed internationally
and enacted into UK law.

The judge found that the complaint that had led to proceedings
being brought in this case was the non-delivery of the cargo at Lagos, due
allegedly to its condition. The relevant suit was, therefore, the claim for
damaging the cargo during the contractual voyage from the load port to Lagos.
"Lagos," he said, " was the only legitimate place of delivery in
relation to the voyage about which complaint is made; and there was a wrongful
refusal of [Trafigura] to take delivery there; the defendant had fulfilled the
owners’ obligations under the voyage charter, subject to any claims that might
have been made in relation to the state of the cargo".

The cause of action was therefore complete at Lagos and time
would start to run from the date that the cargo "should have been
delivered" there. The delivery in Greece and the non-delivery in Lagos were
two separate and distinct events. The delivery in Greece was not the subject of
the suit and it would be contrary to the underlying need for certainty and
clarity to suggest that time started on delivery in Greece.

As a result, the judge gave summary judgment in the owners’
favour, on the grounds that Trafigura’s action was time-barred.

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